The views contained here may not represent the views of 24hGold, its affiliates or advertisers.

24hGold.com makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including, editorials, news, prices, statistics, analyses) provided through its service. In no event shall 24hgold.com, its affiliates or advertisers be liable to any person for any decision made or action taken in reliance upon the information provided herein.

Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of 24hGold.com, is strictly prohibited.

Viewing the chart above, a six-year old child could tell you that
investing in physical gold and gold mining stocks (as indicated by the AMEX
HUI gold bugs index) yielded returns from 2001 to 2012 far superior to the
returns of the US S&P 500 Index over the same time period. In fact, the
truth of this statement is so self-evident, that if this same child was asked
what asset classes he should have been invested in over the past decade by
viewing the above chart, the simplicity of that question might lead him to
think that one is asking a trick question. So why is it that all the leading
Wall Street investment firms stated during the visible onset of the global
financial crisis in 2008 (versus the real onset of the global financial
crisis quite a few years earlier) that gold was one of the riskiest assets in
which one could possible invest? The simple answer, of course, is that if
they were the ones involved in the scam to take gold and silver prices down
back then, then certainly they would not tell you that the steep, rapid (but
short-lived) drop in gold/silver prices was a massive buying opportunity.
However, if a six-year old can see what is so obvious, then why should a man
of Warren Buffets prominence
continue to slander gold and why does his right-hand man, Charlie Munger,
make idiotic statements like gold is a great
thing to sew in your garments if youre a
Jewish family in 1939 but not to own, instead of just
stating the truth that physical gold (and physical
silver) was one of the best assets to build wealth since 2001?
And if a six-year old can look at the above chart and immediately know that
he or she should have beeen invested in gold and gold assets, why, according
to the World Gold Council, is still only 1%, or $146 billion of the $146
trillion investable global assets, invested in gold, and 9.1% invested in
money markets, 48.7% in fixed income, 37.2% in equities and 4.0% in
alternative investments? (though these most recent
statistics are from the end of 2010, it is doubtful that these statistics
have changed much in the past two years.)

One of the main reasons why it is still likely that only 1% of all
global invested assets are invested in gold is the psychological hatchet job
that Wall Street and the global banking industry has performed on gold and gold
stocks. For decades, bankers have repeated their false mantra thatgold
and silver are incredibly risky, using the strategy that if you
tell a lie often enough, it may just be accepted as truth by the masses. The
fact that millions of investors today still wont
even consider buying the top performing asset classes for more than the past
decade (physical gold and physical silver, NOT the GLD and SLV),
serves as testimony to the success of the bankers
anti-gold, anti-silver propaganda campaign. Thus, the reason why just a
piddling amount of investors around the world have allocated a substantial
amount of their resources to gold, silver and PM stocks as of today is due
to, quite simply, investor psychology. The commercial banking industry spends
billions of dollars every year in marketing campaigns (exclusive of their
investor relations budget), influencing and shaping investors
beliefs into accepting a heaping pile of false beliefs. For example,
according to Forbes Magazine, Bank of America spent $2 billion and Citigroup
spent $1.6 billion in 2010 marketing expenses, and the biggest banks spent
even far more for their annual advertising budget in recent years. As a
result, bankers have been able to convince their clients that what is right
for them (physical gold, silver and PM stocks) is wrong, and what is wrong
for them (investing in global developed stock markets) is right.

Why else would anyone stay invested in the US S&P 500, an index,
that from 2001 to the start of 2012, was still in the red (not even
accounting for the effects of inflation), but for ones blind obedience to ones
investment adviser that sells his clients on that moronic 100-year chart of
US stock returns that shows an upward progression of US stocks over an
entirely irrelevant 100-year period, and keeps telling his clients to be
patient, because the US market, in the long-run, has
always returned a phenomenal yield? So here is how investment
advisers, all over the world, convince their clients to ignore a chart, that
in plain sight, tells them that being invested in gold & gold stocks (and
silver & silver stocks) for the last 12 years over any of the developed
broad stock market indexes in the world was clearly the unequivocal correct
decision.

Below are the four methods global investment bank investment advisers
employ to convince their clients to keep doing what is best for himself and
his firm (earning the firm management fees) and what is worst for themselves
(degrading their investment portfolios and wealth):

(1) Frame stock market and PM stock volatility in a biased, skewed and
unforthcoming manner that sells their mission while ignoring reality.

For example, when the S&P 500 index crashed, US investment
advisers used the bounce from 666.79 in March, 2009 to a high of 1219.80 in
April, 2010 to falsely promote the soundness of
the US stock market like ravenous hyenas that had stumbled upon an abandoned
lion kill. In other words, they ignored the bad
volatility of a 57.69% crash to take the S&P500 down to 666.79 level and
repeatedly promoted the fact that the 82.94% increase in the S&P500 was one
of the best in history over and over and over again on
television, radio and newspapers, even though the S&P 500 has still failed to regain its previous
high of 1576.09 prior to the crash in October of 2007.
Furthermore, though gold stocks had crashed too during this time, all global
bank advisers absolutely ignored the much more significant 343% increase of
the HUI gold mining index between October 24, 2008 from
150.27 to a high of 516.16 on December 2, 2009. Forget that over this
same time period, gold stocks outperformed the US S&P 500 index by 313%.
How many people knew that gold stocks rose 343% during this time? Probably
less than 1% of all investors. The focus of global investment advisers is to
bury statistics like this that compete with their precious legalized casinos
called stock markets and to keep their clients invested in their legalized
casinos that are stacked against their clients even when far better
opportunities exist.

(2) Frame performance in a manner that again sells only their desire
to keep their clients invested in global stock markets and keeps the
management fees rolling in.

For example, there have been tons of articles written over the last
3-years that have titles like Whats
Wrong With Gold and Gold Stocks?and Why
You Should Not Invest in Gold or Gold Stocks.
Commercial investment advisers are amazingly keen to talk about holding on to
stocks for a long period of time because they state that one cant
judge performance over a 2-3 year period when stocks are not performing. Yet
when broad stock markets go through flat periods, as the US stock market has
been trapped in a 12-year period now with virtually no gains, you will never
ever, not once in a blue moon, not in a million years, see a blizzard of
articles shouting, Whats Wrong
With the US Stock Market! Yet, bankers ensure that the mass
media is flooded with articles about flat or poor performance of gold and
silver stocks during the past three years to keep their clients away from PM
stocks and they harp incessantly about this matter while completely ignoring
multi-year trends in gold and silver mining stocks and keeping this
information buried as well. So lets look at both asset classes and
compare performance over a reasonable 12-year investment period, not the
ridiculous 100-year chart investment advisers are so keen to use. If one
looks at a reasonable 12-year period between 2001 and 2013, the S&P 500
has not even returned a piddling 9% during this period, while gold has
returned a whopping +524.77% (silver also returned a phenomenal yield over
this same period as well). And what about gold stocks, even when including
the very flat last three years of performance? An almost unfathomable
+1009.86% return when compared to the US S&P 500s
anemic return of 8% and change.

(3) Sell rubbish diversification strategies as expert
advice when it is the worst advice in the world.

A great many people are afraid to concentrate their assets in gold and
silver, among the best performing assets of the last 12 years, because for
decades, the commercial investment industry has pounded into their brains
that anything but diversification when it comes to investing is unsafe,
unsound and risky. Yet diversification is a rubbish
strategy used by all commercial investment advisers
precisely because they lack the expertise and knowledge to know how to
concentrate a portfolio properly without excessive amounts of risk. If you
have the expertise, you can utilize concentration without increasing the risk
of a portfolio. Thats why for years, weve
been advocating our clients to invest very substantial amounts of their
portfolio into physical gold and physical silver because frankly, despite the
notorious volatility of gold and silver, we just didnt
consider gold and silver risky when they were respectively $560 a troy ounce
and $9 a troy ounce. In fact, every year for the past 12 years, gold and
silver has fallen to price ranges that marked solid entry prices that were
low-risk, high-reward. The artificial banker-created volatility through
manipulation of gold and silver prices ensured this.

A recent study by Nobel Laureate
Daniel Kahnemantracked a group of 25 wealth
advisers/portfolio managers and the variance of their portfolio yields over
an 8-year period. At the end of his study, Kahneman stated that he was shocked to
discover almost no variance in the portfolio performance over the group of
managers, simply because he believed that portfolio management was a task
that depended upon skill and expertise. Consequently, Kahneman expected
wide-variance among the managers as far as performance yields over an 8-year
period were concerned. Instead, he discovered that the variances among the
performance yields suggested that portfolio management was not a skilled job
but one that nearly entirely revolved around blind luck. My first reaction to
Kahnemans study was that he should have started his study by
sitting in an office of Goldman Sachs or JP Morgan for 3-months and he would
have learned within 3-months what it took him 8-years to conclude 
that Portfolio Managers have no skill and that they all use the terrible
strategy of diversification to cover up their severe skill deficiencies
rather than diversification being a strategy that allows them to demonstrate
their skill. How many US clients were protected by the strategy of
diversification in 2008 when US markets collapsed by 38.50%? By the anecdotal
information I gathered, all my contacts at the big US global investment firms
told me that nearly all their
clients were down the same 35% to 40% that year as the S&P 500 Index.
Therefore, diversification did nothing but assure that nearly all clients
suffered the same uniform losses as the major global developed indexes that
year. In fact, diversification is a protective strategy embraced by the
global investment industry as insurance against client
flight. In other words, if all client portfolios show
remarkably similar losses across multiple commerical investment firms during
poor years of stock performance, the risk of client flight is small.

On the contrary, we at SmartKnowledgeU, have
always taken the strategy of concentration over diversification, and in 2008,
though it was a nominal gain, we still managed to yield nominal positive
returns in our newsletter investment portfolio despite massive losses in all
developed global stock markets. Massive outperformance can, and often, will
be the result when skill and expertise, instead of luck, is applied to
investment strategies. If concentration is so dangerous, and if
diversification is a far superior strategy as nearly all investment advisers
claim, then it may be possible for one fluke year to occur. But it is near
impossible for five fluke years to occur. However, we at SmartKnowledgeU
have been concentrating our Crisis Investment Opportunities
portfolio since mid-2007 when we first launched, every year
now for more than five years. Over that 5-½ year period, weve outperformed the S&P 500 by
+161.95% and even outperformed the HUI gold bugs index by +120.80% due to the
strategies we use to take advantage of the banker-induced volatilty
in gold and silver markets. So much for diversification and buy & hold
being wise investment strategies.

(4)Sell volatility as dangerous
& risky even though
this simply is not true.

The reason some of you may be shocked by the chart Ive
presented above is not only due to the tactics of #1 to #3 employed by the
global investment industry, but also because of one additional key factor.
Many of you may think that gold & gold stocks are way more volatile than
my chart above shows, and you would be correct. Ive
only plotted the beginning price level of each asset above at the beginning
of each year to smooth out all the interim volatility, so that everyone can
clearly see the trends of each asset, even in the notoriously volatile gold
(& silver) mining stocks. The reason Ive stripped out
the volatility in the above chart is because anyone that has studied the
price behavior of gold & silver assets knows that Central Banks and
bullion banks deliberately introduce volatility into gold & silver assets
to intimidate gold & silver newbie investors into terrible decisions of
selling all their gold & silver assets, or to scare off potentially new
gold & silver buyers from ever buying. Though a commercial investment
adviser would never tell you this secret, the evidence of this is
overwhelming and since Ive blogged many times about this
very topic over the past 7 years, Im not going to go into detail
about the mechanisms by which the banking industry deliberately creates
volatile prices in gold and silver assets in this article. However, since the
banking industry has already sold the masses hook, line and sinker, on the
very false mantra that volatility = risk, by
artificially and deliberately causing short-term volatility every year in
gold and silver assets, commercial investment advisers can show their clients
charts of gold, silver and mining stocks with all intra-day, intra-month or
intra-year volatility, and keep convincing their clients that gold and silver
are the riskiest assets in the entire investment universe while convincing
them that broad stock market indexes are the safest arenas in which to
invest, when indeed, the exact opposite has been true for 12 years, and will
likely be true for the next decade as well.

Sure, one has to understand how and why the bankers create volatility
in gold and silver assets to ensure that one enters these assets at low-risk,
high-reward price points instead of high-risk, low-reward price points in
order to be successful, but anyone that has studied gold and silver price
behavior and understands how bankers manipulate gold and silver prices should
now have the expertise to provide this guidance and help novice gold/silver
investors navigate through all the rubbish manipulative schemes of bankers.
If one doesnt understand
what drives gold and silver prices and one enters at a high-risk, low-reward
entry price, then certainly, one could have been taken to the cleaners after
banker conducted raids against gold and silver executed in the paper markets,
despite what the above chart illustrates. In addition, bankers also attempt
to keep people out of buying physical gold and silver and PM mining stocks by
painting charts to drive and intensify fear of gold and silver collapses
during their multiple, annual banker raids on gold and silver prices. Every
year, after there is intense short-term volatility in gold & silver in
the form of a 3-5% drop in gold and/or silver in just a couple days, more
than a handful of pure technical chartists will come out of the woodwork to
predict massive collapses of silver and gold. Last year, when these
situations occurred, more than a few chartists unnecessarily stoked fires of
panic by predicting imminent collapses of silver to $20 an ounce and gold
back to $1200 an ounce (or even lower). And every year, these predicted
collapses of a gold bubble and
silver bubble never materialize. But these
false predictions gain enough publicity to keep many too scared from buying
their first ounce of physical gold, physical silver or their first PM mining
stock. Again, remember that bankers deliberately paint these gold and silver
charts to give the appearance of an imminent collapse in prices even though
the underlying, undiscussed fundamentals of the physical bullion world often
directly contradict the price action of gold and silver during
banker-executed raids on the PMs. This is why I have maintained for many
years that technical analysis in gold and silver (and even in the highly
rigged stock markets) is quite useless if conducted in a vacuum. However, if
one uses technical analysis in conjunction with analyzing the underlying
fraudulent mechanisms of what is causing great volatility in gold &
silver markets, then one is much more likely to accurately assess these rapid
declines in gold and silver price as buying opportunities as opposed to
fostering clients to panic sell their PMs like fleeing lemmings off a cliffs edge.

As Nobel Laureate Daniel Kahneman recently discovered, and as weve been stating at SmartKnowledgeU for
nearly a decade now, the entire financial industry is built upon deception
and rigging of markets. Their entire existence as ongoing, viable entities is
based upon the creation and maintenance of an illusion among all their
clients that they know what they are doing even though they do not, and even
though they have recommended the same course of action for the past 12-years
that has greatly failed. As long as the commercial investment industry can
keep this illusion going, they can keep convincing their clients that gold
and gold stocks (as well as silver) are the riskiest investments ever and
simultaneously prevent their clients from realizing the simple truth
self-evident in my one chart above and from escaping the inertia of their
poor advice.

Furthermore, since the conditions that launched this present gold
& silver bull are even stronger and more favorable today than at the start
of this PM bull, the reasons to be invested in gold (silver) and gold stocks
(& silver stocks) are even stronger today than they were 12 years ago. In
conclusion, ignore the simplicity of the above chart at grave risk to your
own future financial health and security.

About the
author: JS
Kim is the Founder & Managing Director of SmartKnowledgeU

, a
fiercely independent investment research & consulting firm with a mission
of education and helping Main Street beat the corruption of Wall Street.
SmartKnowledgeU was the first company in the west to move to a gold standard
of pricing, a pricing mechanism to which the firm has remained firmly committed,
even when gold prices have been moved lower by bankers as in recent times.
Currently, we are offering a 5% to 10% discount on all SmartKnowledgeU services until the end of January only, a discount that when combined with our
significant discount in prices due to current lower gold prices, will almost
assuredly mark our lowest prices of the year for 2013. Follow us on twitter@smartknowledgeu.

JS Kim is the Managing Director and Founder of SmartKnowledgeU, a fiercely independent investment consulting and research firm that devises investment strategies to protect Main Street from the fraud of Wall Street.